This paper discusses the design of a novel multi-dimensional mechanism which allows a principal to procure a single project or an item from multiple suppliers through a two-step payment. The suppliers are capable of producing different qualities at costs which cannot exceed a certain value and...

In this paper it is demonstrated that voluntary bargaining over a collective decision under asymmetric information may well lead to ex post efficiency if the default decision is non-trivial. It is argued that the default decision may be interpreted as a 'simple' contract that the parties have...

This paper raises a neglecteed point in the literature on local public services, showing that even "formal privatizaion" (the transformation of the service provider into a joint-stock company) has a significant influence on the agents involved. The relationship between local government and the...

I develop a model of contracting under reciprocal altruism accounting for some evidence which is paradoxical from the point of view of neoclassical models with selfish actors. My model predicts the crowding-out effect observed in the Trust Game with the possibility of a fine; for the Control Game...

This paper examines uberrimae fidei (utmost good faith) with adverse selection in an insurance market. If consumers know their risk type (they know their expected loss), and if they understand the concept of uberrimae fidei, adverse selection is completely eliminated. However, if uberrimae fidei...

This article provides a non-technical survey on recent topics in the theory of contracts. The hold-up problem is presented and the incomplete contracts approach is discussed. Emphasis is put on conceptual problems and open questions that await further research.

The paper is concerned with the efficient organization of contractual relationships between health insurers and providers. An introduction to relevant aspects of contract theory is followed by their adaptation to the characteristics of the health care system. The focus lies on an ex ante...

Using a gift exchange experiment, we show that the ability of reciprocity to overcome incentive problems inherent in principal-agent settings is greatly reduced when the agent’s effort is distorted by random shocks and transmitted imperfectly to the principal. Specifically, we find that gift...

This paper is a theoretical introduction to modern governance of universities in developing countries. Indeed, adopting the approach of the paradigm of the theory of incentives Laffont and Tirole (1993), this paper discusses the effects of the presence of information asymmetry between the State...